Thinking of UK Index Linked Gilts

Prism

newbinvestor wrote: »

That's assuming there are new bonds in the future to invest in, which isn't guaranteed.

Bond funds don't need new bonds. They buy old ones and sell before maturity as required. That why the maturity dates and initial price doesn't matter

masonic

newbinvestor wrote: »

That's assuming there are new bonds in the future to invest in, which isn't guaranteed.

You can't honestly believe there is even a slim possibility that countries and companies with active bonds in issue are henceforth going to pay off all of their debts and stop borrowing money in the future.

Nonetheless, unless it is certain no further bonds will be issued, and the £84 trillion or so bonds in issue will be repaid and not renewed over the coming years, it is impossible to calculate the YTM for a bond fund, except for one that has ceased trading and is being wound down (this is not the sort of fund in which you'd want to be invested).

ColdIron

OP is pulling our chain

Aretnap

masonic wrote: »

You can't honestly believe there is even a slim possibility that countries and companies with active bonds in issue are henceforth going to pay off all of their debts and stop borrowing money in the future.

He does actually seen to believe this. Or at least that this is what should happen. That's the logic of all the "but how will they ever pay it back?" in this thread.

https://forums.moneysavingexpert.com/discussion/6029536